CTRA - Earnings call transcript Q2 2019 | Alpha Metallurgical Resources, Inc.

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Operator

Good morning, my name is Carol, and I will be your operator today. At this time, I would like to welcome everyone to the Contura Energy Second Quarter 2019 Earnings Call. [Operator Instructions]

At this time, I would like to turn the call over to Alex Rotonen, Vice President, Investor Relations. Please go ahead, sir.

Alex Rotonen

morning good and Carol, everyone. Thanks,

performance let Before materially our to from you and financial during those discussed. remind remarks we expected results and differ and relating begin, prepared comments the that, our statements, me Q&A may forward-looking contain business actual period,

about For more filing. earnings XXXX information some reconciliation measures documents release associated SEC statements forward-looking also non-GAAP of can see that for quarter factors information company's use please them, second regarding Please and those GAAP affect to refer and of the our to the and their measures.

the are is an dynamics. the current Also call participating Participating Officer, Stanley, Executive on Eidson. Chief update on call the Commercial today provide Kevin Officers, and David will market Stetson; on Andy coal our Chief Officer, Financial Chief Contura's who

to turn that, I'll With call the David. over

David Stetson

Thanks participating. for to Alex. thanks morning Good everyone and

workforce organization With the Andy experienced leading I I'd thank tremendous and assets start organization to job First, to like the they particular the management want Mark recent during a excellent transition. be leadership second as saying how in am company's deep did for with to and this to I Contura's managing that's excited interim-CEOs to this team, by in and regard none.

faced of high believe covering have several the developments number the we positive for toward a past and company. I the potential be we'll While that future of bright several months, challenges Contura is very the today point

to strategic that of Directors some looking and Board management changes allow our vision Contura us to team, I'm for with you Additionally, to structural vision. better which efforts include sharing forward longer-term our my the on focus that both

our million million was million in of second tons. the to quarter record by over as quarter shipments increased by compared second nearly the of $XXX operational and with XX% to operations. EBITDA exceptional We first X.X provided performance met Our quarter high cash $XXX

I but segments all a to am much of we reduced cost comfortable. work coal our which operating addition, sales do cost we to with still In to across get have level

second this aware very held the we two that for market the well how I'm Obviously, quarter is we well softening market seaborne July. everyone them. has has in met years, dynamics us, past we the begun on over While of strong up can can't react was sure but control to so call control

the what result XX.X million short-term as Therefore, in overly we production challenging, for to than aggressive being new market, buyer's million returns our of niche we the at rational our a selling to of are a CAPP shipment lowering we range into year. tons. be believe for XX specifically, the a guidance of are Rather remainder low segment to the

CAAP guidance tons. We to are X.X also thermal lowering of a to million million X.X our range

to we potential our conditions later. updated remarks, conservative more end softness given there the is America. South While a his met at markets will to most discuss time it's prudent and coal the second believe upside the and these use some additional and notably we at both Andy provide guidance, guidance in market we bit about Kevin think this revised Europe will our prepared quarter color Stanley be in detail more experienced

to recent the there. asset situation filing update the related sale, a want bankruptcy to Turning Blackjewel brief our and I you regarding give

Virginia. Campbell Belle reported, widely as been Surface Ayr vol mines Eagle County, has in West Mine Wyoming, Pax high it well as the for we County, were A for Fayette in As Butte successful the and bidder

to sale. pending ongoing the the note however, in objection transaction an federal with particular still relevant and contingent the in to that resolve to on the with effort agencies States to debtor Wyoming is We're those the both United the issues. mines important upon discussions resolution government It's a

are you to of on Contura's of two Wyoming XXXX the Eastern to aware, in sharpen Coal in order its Western all in to operating company's As Blackjewel subsidiary a asset I'm of December divested West Contura wholly-owned mines heavy lengthy most undertook these base. focus met Blackjewel to West began permits jointly transfer it Contura leases the and while process Blackjewel. State sure the mines, Coal

both Control all of which of Surface the permit and As Bel Air, of Butte obligations the successfully XXXX exception mid-year breach carry permits them related have reclamation the Eagle been leases transferred and with operations. Act for Mining with Reclamation

maintain As sufficient sureties those and obligations such, other bonding mines. with to to for cover third-party we two continue reclamation

most After accommodate for Blackjewel a a of the optionality us or determined operations. company careful as horse we smooth In filed as for stocking a through analysis, XX X, assets. to was bidder process as provide action sale to with select July the well course on order those regarding prudent Blackjewel protection Chapter serve

that and hand and The surface mine existing Southern Virginia vol Pax the Mine a opportunities. highwall on further operations metallurgical footprint our other and synergies and provide expands near cost blending high coal West is low South in located logistical our

fact, In when million of Pax operational, should cost our bidder for total of production to return produce Blackjewel up annual cover tons the generate X.X assets. fully the the believe and enough we Mine can to roughly

confident Andy to not it this with right mitigate with assets resolution little the call. these a and secure this the to to going later with bit our value the is be work River a we any more and on that while adverse you Again, was plan, near-term enterprise. situation acquisition financial in share six was months proactive obviously impact in ago, to Powder decision are create color both

safety be and foundational company. Safety for Contura's our value Next, performance. always core a I'd like to consistently few will to turn is and environmental a strong comments

continues I'm our value. share safety pleased that to such, core to that adherence to reflect As performance our

national national total Specifically, year-to-date lower than with rate, meaningfully our was quarter reportable the results incident July our better and the second average. than average, the

throughout for the year three January both exceedances decrease continued and to also second the for than average July better June XX% our and total average compared environmental with the were inspector NFDL Positive to period. a quarter time period. Similarly, a day performance national year-to-date violations in for

DNA. we simply we part forward, both will of focus stewardship on environment as continued safety, our Going maintain our improvement in

I'll wrap level over going vision coming I'll just high up strategic forward. months, working our weeks of the Contura over entire for overview prepared weeks I've remarks and focus with now the to the Company. my be with two been and the in implement team my

However, here which action. of high focus taking in are are some level we already

we the can't control First, market.

be me priority the be and focus team. and an is between implementing historic operations. our on and levels operations. sales our So that better and therefore, management structure changes safe to coordination I'll cost for This entire efficient lower will provide running must for extremely high more

that our lowering these maintaining Let can of without cannot impacting clear, the should and possible environmental lower I the cost costs operations. safety at me not lowest the come met am one can negatively be in say costs confident expense standards. responsible highest in producers sustain commitment Central and become Contura of to App and

and I Secondly, strong with believe am committed to a in and can believe a robust so - do concert sheet maintaining we capital balance we return program.

both I for value pursue goals measure focusing important free to the flow. shareholders, be most believe will We our on cash what by

to to our free I succeed first cash current capital shareholders. capital operations Capital at the and We us very us allow the Contura announcing Strong the enabling to tranche returning while be fund are trading Program meaningful Return to price, step, expect the materially of believe our and shares the a will near future. next strategic in undervalued needs

product divesting that that to help the the opportunities have Contura's means will actively on long-term ensure asset upside our take market are or position market advantage new downside of strategic our to whether managing against or potential metallurgical asset in dynamics offerings company we optimization leveraging enhance I I firmly portfolio Third, the reserves fully favorable acquiring critical met properties position. but expand the best non-strategic or risk, believe protecting be continues to while coal am success. to mines focused thermal

I'm Kreutzer been also strong have that my with a vision In impressed Scott ability I've to you strategic team success and in starts with the time believer short here, execute. place.

him to operation, I'm non-strategic with assets Contura leading saw Chief for U.S. be I've to new of the company most to tasked met as my and newly of with our acquire you work late divest ensuring the decades Strategy announcement As thermal directly will implementing me goal asked sure come. the vision with reserves yesterday, Officer, created

Northern Jason as at for role in Whitehead, Central coal who miner our almost and is Contura. has Alpha, App previous who coal here uniquely will CEO a the familiar with two decades role experience of me has as He CEO property. see of

process allow more for are decision of expertise specific making. in to and the also considering industry increase board We efficient our

expect is transaction our over Finally, as has transition in of the Those degree leadership some kind navigated I events price. unexpected from the couple to material current recent the events of share asset a out west. company the in reflected months

uncertainty of our among external Create key stakeholders. level a

with think areas future aware and to I am in give the such, As big We in attention within the role regard to levels that to all all will acutely tackling daily of Contura's also basics, company. and blocking broader we must industry. the significant our the strive

of is shareholders interaction with engaging hosting investor owners. am our offices process roadshows. the future important through with in outreach our fully to that I An and increasing our non-deal conferences, committed our at part enhance investors increased potential to and in participation owners,

overview. Commercial Officer, to our a I'll call Chief that, the provide turn over With Kevin Stanley, market will who

Kevin Stanley

David. you, Thank

Australia in in as after the coal in spot volatility increased. for As change short-term, U.S. in products. opportunities This markets referenced has two coal demand David increase years pricing overcome a logistical met been past we over indices by the export and accompanied softened reduced stability in and shipments there have in are weeks. growth international resulted softening challenges a of supply in particularly reflected the balance, significant balance relative as supply, metallurgical has shift several an earlier, At U.S. has least track short-term seen with plus in have

high the July. XX% The Atlantic of beginning vol approximately A since declined Pax

periods to As when spreads usually these between case pressured, shrink tend well. the qualities as coal is the various in overall market the the is

ago $XX representing spread the priced A Atlantic B. metric vol high over month per a example, $XXX was For vol ton high at a

while indicate looking smaller A high Australian obviously $XX. at X and Currently, declined B the has meaningfully, futures at note has vol market the and when that price between vol XXXX late is $XXX decline spot strip. to XXXX the price vol and high important much a the is low It's to spread narrowed

the XXXX August from example, $XXX, December as the from much, coal earlier. strip coking forward declined $XXX. was the hard declined And half approximately months futures $XXX June $XXX. But XXXX to Australian two early less to spot $XXX at even down $XXX For premium from

of are trends. pricing While future simply Australian of indicative somewhat curve, the indices be today's snapshot should forward these they

the in seaborne that to market growth domestic continue confluence This met the many tells equilibrium quite demand both We We prices in futures to that the us supply are dynamic driven several upside be the limited. by in the softness supply markets. believe production factors use a near decline end levels. U.S. view of recent expects

slowing port summer and restrictions experiencing enforce Europe softness. its some Australian met several imports while exports monsoon other sparked has India's to from for year-end. limit currently imports been months normal now, fiscal more their related primarily China affected slowdown Australia. markets short-term are coal are to by the likely continues for met in

issues balance clearly This continue That it's quite these global met some over the should said, with met we'll short-term as the recovery. resolved. temporary the CAPP end price see coal year any of indicates that balance firming possible slowdown prices of get

while more in significant most overall China demand production little picture, softness crude color excluding June Europe demand in being X.X% quite a the underlying appears declined crude some showing a with on at regions Add steel global world the decline. healthy, X% steel

X% roughly in year-to-date. and decline that experienced also America June South

crude is crude followed June strongest markets year China XX% year-to-date. in the up for for U.S. and X% by steel June India, production grew for X% and the X.X% to The year and continue X.X% which growing be X.X% for June. steel

that and year-to-date and Given X% X% struggle and not America, met exports the both U.S. weakness respectively. in Europe exports it's with June South declining to surprising continue

July. manufacturing purchasing way the economic look to showed the the indices of from is possible XX.X XX.X Many and negative, India exception the which slightly managers' with at major dynamics and PMIs were global impact Another U.S. respectively. considered of

one and imports India softness is temporary. us The export results markets and it met the confidence that flattish overall with gives our indicating low with XX.X in under as aforementioned are Europe a XX.X. growth. key PMI from India are especially The China Germany seven the as in ratings both at at encouraging weakest just year coming more are EU of of Brazil XX

are which benefits dynamics we'll concerns picture are in once are trade and trade from the increased dislocations for we tariffs past the term. In summary, showing near market long we get the believe these No term. issues. the short country reduced a met challenges helping over continued better in term markets Not

these sooner in trade prices of over expect get as months futures. So Again it's we expect couple only the behavior, later. resolved issues rational rational to indicated from rather to assuming the met than stabilize next by

I'll that, turn to call with And over Andy. the

Andy Eidson

Kevin. Thanks

quarter As we'll as with David we see compared the mentioned the call, but of million all was here improvement mostly second of a The $XXX across in revenues great cost containment with the beginning quarter. strong EBITDA, first as also at $XX by did the have million about higher driven segments.

contributed our million operations NAP adjusted that, $XX $XX bit, generated EBITDA $XX into performance SG&A was million, the is And not a dig CAPP addition segments. about generated million million thermal of Logistics and the expense during in individual segment which respectively. Trading thermal and little cap against $XXX we As about and allocated the quarter. met million about individual $X to

From met shipments to increased compared to quarter second X.X XXX,XXX to from shipment X.XX. to million as tons tons a shipments increased increased roughly was X.XX million the Thermal around quarter with and net perspective, first X.X tons. X.X flat X while volumes at first tons CAP quarter, CAPP from T&L from million million

along material higher increased Central cost at due quarter cost that's the to The of will continue this is end we down yielded as side, efforts success productivity build bringing first be end the our met, with positive of earlier, quarter commitment miners and quarter thanks, App our saw we coal the across David the on to costs of at and steps to we quarter acutely cost a operations. on be results when improvements not our higher as to the Again, continued segments. And believe creeping operating saw to considerably dedication all, over as what all that. continue we good we we far on mentioned very focused and of expect took

out the CAPP as a treasury so the noting is bit the $X much $XX.XX, first much cost side digging on in met didn't the with of of just items. impacts to And the and any sales hair also, this over production the it's and quarter. deeper $XX is a to $XX produced purchased roughly worth compared knock simply underlying Again the purchase impact the primarily But volumes benefits categories by coal into We from and of other impact quarter. coal cost to really have declined that picture, higher we in coal. fill second labor gaps less to in any driven

a cost. So our our that a that was ton $X a brings down about bit reduction on cost obviously

CAPP look came about you met at cost production If met, the the captive the segment, in in strictly CAPP at $XX.XX.

way CAPP very all QX. From to the down good perspective, a a quarter, XX that in again thermal in perspective. the So improved was very, a quarter cost from XX, cost first from $XX.XX

higher in in quarter mentioned segment Slabcamp back and April. in infrastructure factor some were normal first the main our fully the related everything the were which resolved we QX issues in to for costs production results, at to was mine, the As

So full pretty quarter full also. pretty this from the mines we segment wells and got in to then performed production that close of other mine

no were quarter. saw also was NAPP at performance quarter much We there longwall productivity and increased the during also better. Second moves

three third So quarter cost that month move a be very impacted by expect period. achieve to NAPP September. helped in strong Contura We longwall do

year staggered year quarter a as first moves – a have two out third and we Just longwall reminder, the this quarter.

where a move there quarters in about a as longwall a impact one. to quarters there's ton without typically compared So $X cost

of in end from at QX. that impact unrestricted million the million quarter. see of had approximately liquidity, the second probably looking up the at I'm end quarter we'll first at $XXX $XXX company So in cash, the the

on things workers that. restricted black the comp total $XXX for cash cash Our and as like policies surety balance million policies, supports, – collateral again bonds, basically line was restricted balance

you ABL restricted million our and under in cash. of cash And XX. which a gets $XXX unrestricted Total availability was to includes $XXX total of million June available as so, total and that liquidity, unrestricted

we provided primarily million For of did million. have decline $XXX little $XX in declined were in really account AR quarter in QX, million out. essentially cash in capital accounts million as inventory naturally flows, payable. flat $XX there was was strong in bit build inventory. more in build and We And a that movements bit the has was some We now a intra inventory offset by operations total kind working the in cash for then, capital compared quarter, with at second Working here AR in does about tend by $XX capital a QX, cleared built we - fluctuate. also do a working increase

of should some back the we year. half start work see debt a as inventory we to bit So reverse the down levels of the in

from guidance range. given we're shipments segment of our the our ton year-to-date just Turning of view a XX.X based within call, softer T&L balance on X for earlier X.X of million was million ton our to are discussed guidance. in million tons. making that We the to expect range we to to CAPP Also, X.X million strong demand million to updates cautious to to Met XX.X XX.X million between the from our tons we're some ship down XXXX X.X thus, the shipments XX guidance in million previously more taking increasing and previous to our a outlook announced the year now guidance segment the million

will maintaining to X.X an a price math, CAPP been we're I shifting we've little from solid midpoint. Thermal or the range all met committed versa. We at million ton in did, the calls QX. since X.X incidental a been across in position mentioned of amount $XXX.XX production as to the range includes guidance because of booked slightly note, of and believe of from reducing here far guidance, – roughly X.X our of thermal XX% X.X you the ton bit And CAPP segment, of average in met I per a From million segments X looking aspect, incremental where tons announced our at think CAPP have that committed X that ton. we're some previous are ton previously as this million vice has

some incidental around includes thermal bit relates CAPP commitments a a order as shifting Our production meet it there between to is little sometimes of sources tons to we're from met level. as and movement price categories,

you our our just two they've bit look, So with you try and get to met note of flat less. pretty has of committed previous for pricing pricing The quarter. reported quarter-over-quarter up would commitments, a on that's CAPP that's commitments it the new up for about newly $XXX while little tons artificially between you'll mix also thermal if thermal the tons categories. is the compare of that shows ton, an bit But little a per gone low again impact held actual those crossing the

we CAPP we're per XX% board. a Speaking effectively roughly of across thermal in are maintaining that our guidance of guidance cost segment $XX.XX XXX% cost price committed On the ton. at

we looking at to high QX that and then thermal. through in too in saw that point itself saw we the which in look this met mentioned pretty Again, was both we cost affirm So out that see rest expected thinking point I QX, time we What QX of and CAPP we at thermal can there. year, we to – straighten happen. think still I shape in think probably where the and be back at good had

look of appears bit mine I what that dependent, And through will as in relatively place. started some out of down high sine see will back but that cost year, trend wave and kind rest speaking then QX, be to discussed lower It these higher implement costs a much by perspective, met changes a of like production things as going we probably QX, that we'll trend we the little initial QX, should the in From had guidance. market settling still are QX think think the be plan I to again in a relates QX Marfork. closer in where to all it kind we

and run expense lot higher-than-expected months one mostly in We are legal and SG&A the the our with to to testing. associated of just based expenses rate for range million accounting $XX as $XX on our a six area, year fees guidance of increasing professional costs first standup a to related million result SOX

going to So to cash that be kind also $XX expense million range We've reflect of non-recurring the term $XX a refinancing to our loan. interest our would increased million of expense a forward.

million. Finally, XXX we are of XXX to maintaining our CapEx range guidance million

acquisition David's the to being to Blackjewel of transaction dependent actual take of items by comments. To to agreement the add Powder River with in government This Basin to theirs. of economics sale little want situation, reached care a present the on on color the the federal of we its is reemphasizing wholly I objection that need start couple a

regard to So also clock pretty that in it's tight on the funds. debtors operating noting day-to-day a worth

So certainly absolute could move will before – an and certainty that a not reached be slightly forced debtor to is X different agreement which be liquidate, an outcome. Chapter the to it's

a PAX's bracketed financial with directly of share required our value we side to present looking that I are mind up of what the to one transaction. the of at process in and better and a In net mine in did move come outcome. the net that are were But and to that impact want in would that's unable we the ballpark separate outcome. which $XXX of estimate looking thinking million kind we a reclamation cost having to be. about impact that of scenario, If at is a fact would

you at by and see which details, number basically it's million. about a the supports mines impact does more publicly at Wyoming is And $XXX of performed dig If can of such that million are as roughly is for you some its those for into face NPV so bonds down acquisition way Wyoming, include would for you State million already items amount of shovel posted happen. that include does required calculation that that $XXX when that need starts to stated that that the the $XX things the look property reclamation that's how number shovel working of the in

where basically come and third-party the being also scenario than driven to is has a in a itself do an It - reclamation off situation. of rather it orderly

So mark it. into contingencies there are contractor built

So as what than you the that down the burn walk a up to less reclamation it cash plan realistic, ends bit quite bonds. a being is, for stated face amount of

looks so over XX a again, X roughly And this and situation plan. out it $XXX like be impact that, million year to spread approved to pending about in horizon reclamation

given So, $X manageable but and And this opportunity be a $XXX – is would our more very of share, it's We've on to since very believe our going the punished good this believe exposure PRB. a roughly reclamation company XX% again a rather deal share if share the net and forward. is we we Xst. the support the have the certainly would happen, explain clearly event what to with, continued approach out way Blackjewel and there July not market would bit like, get does the to looks that us it to probably something it. in more as due than decline that of the information We situation initially current approximately just on in the million to price filed count equates numbers impact

David Stetson

very EBITDA, wrap So improvements had continuing good cash we quarter second generation impressive our committed forward. everything cost cost improve just and strong the an going Again exceptional at to structure up. to kind operations. And fully very are of

effectively place, continue With we're in and controllable I we performance be our forward. the confident will able optimize to to that leadership aspects think going the new manage

again seeing Conference and to thanks attending next Global everyone you there. those the appreciate for We being the we St. in on to for week. And today, look Louis Securities Seaport call interest forward

we So for operator, questions. I ready with that, believe are

Operator

ahead. [Operator go Mark from comes Instructions] Please Our Seaport question from Global. Levin first

Mark Levin

and new on think congratulations position strong day were and was on I good it's a your a very Great a congratulations very when announced very It David quarter. you day. good also

start to you ones think and say you some other the Let QX third back and play side gating a referenced as had some on general the more – some ask how questions earnings the me specific year? QX in longwall specific maybe half items. maybe EBITDA with maybe and more EBITDA out When quarter about Andy, XQ then move out give and let's versus of in can QX, should us cadence the then you

David Stetson

expect function. here I don't Yes, want don't turn. throw on we I safe the Mark going the to again appearing wave sound get out we to to say market in is again way too kind to to try precise it's I that into the failed But because achieve. way to think want cost just something move based to this of a

to expect think QX have slightly I costs. higher we could

longwall the impact NAPP. which move, have We will will

direction, so saw looking see ballpark, we mean, it to what be to going be in in the tough markets market third as the going would really the I the On is QX. same quarter

on level. going rebound of Do further where need back to of XXX we deeper kind the to or hit little have prices good now. any the go a support be that really Again, and don't function out, it's market the kind into view we lands some really bounce a as support right – see met bit do before a of we

able So probably at will be of of go. best controllable cost on think the guidance where it kind just – it generic we piece to some leave

Mark Levin

domestic XXXX XXXX? could you I what about remind – is was versus sense, makes negotiations then your you now. guys mix in Can your like think what domestic a and the look into and reasonable us that entering are way No, what know in as export to mix to

Kevin Stanley

is is this for tons domestic just X Stanley, Kevin XXXX. coal over Mark, million our position

that at million million put early to process guided that's of for segment going you're start put negotiation in domestic a XXXX over on X XX.X to that's a the so if Met for So that. it's bit difficult. XX so just tons to volume very million number volumes CAPP little to obviously, you, on at tons XXXX,

you two in we other the The XXXX, separate domestic market, going I would into we were thing companies. were when remind

a So we'll in with go consolidated strategy.

I we're looking pretty think similar Contura something. into XX, and at Alpha, we were going but

want gas just to hit venture So I don't a on XXXX.

Mark Levin

then in. an what to cost timeframe the of sort think reclamation of impact sort you cost in should doing we you assets? were the annual A), And be those NPV go calculation which about the the under impact real to under if NPV XX actually – the of to have sort just B), cash scenario. Maybe you then operating turning that XXXX/XXXX you year in without route out scenario How eight assets Andy, do these laid back the over quickly would Blackjewel to if are and bring

David Stetson

to out think I a acquiring earlier of will loaded. for the get or The direction kind kinds contractor Yes, process has million of step Mark, all our we upon plans us pivot, and with be But to some communicating pending mentioned, specifics, XX% would plan lock the keeping to market $XX you Department do this again we're it be somewhat as many need it as Wyoming and items Environmental think, of process, reclamation that developed, and Quality, too through sure I in making event into of mentioned front-end been the – kind adjusting agreement other. who trying with things. shovel that course, of I the of and of – one our well without those if

loaded. If you where picture. total XX-year a of you its – number period. say year the cost out would on you front-end $XXX range million that be just that those gross to million million It $XXX over a scenario and It's not gets would based pull kind with $XX it

So get looking and after And at portions you start been rest have couple taper specific, first of in some the trying out XX-ish not plan. again moved the maybe to the but you're years. million of level then big dirt throughout reclamation and the of to too you

us perspective. give the But us I with impact or a think costs still reclamation again, of look got engaging third-party leg some consultants view to, to DEQ we're would a what And got like. better we do, to a burn cash get – the two a again working help from will, work minimize to we've with hopefully refreshed

Mark Levin

And look if what don't it reclaim, you like? would

Andy Eidson

longer term. it's or this Yes reclaim, us a reason. attacking It options of transaction things transactions out term it's more assets, gives that don't of with the believe operational longer around approach. mean strategically operating the operating to shorter earlier. term. lot strategic as we if of of mentioned terribly pursuing down for PRB we're does question – That different just been interested said in versus more doing that whether pursuing got comes know we I I I don't as David structured to a do additional short-term a anything

the all Just of options us can with resolution kind where to point this still are get some on more we do but to orderly these various in table reclamation, counterparties a a the pending process.

Mark Levin

for to appropriate my are think on And question David. David, opportunities you side, back more the that mentioned levels getting you you for then just about last where need cost the to the is the or enterprise. some cost about kind when think expect you like get to of of Can maybe levers they you to cost that to talk you back down about think be? pull to would pull

David Stetson

Well, XX Mark coming have been days. here good XX, a in I

that's obviously, going I'm efficiency to per of the going trying Whitehead in feed A what a those Jason to driving evaluate need themselves. is back. seen go is shift We've on and force with in tandem on. working the most drop we of that is to at mines off those, its increase be lot Jason at working to So themselves mines

the think I it's of cost side So of it. perspective, from more efficiency a

it's quite frankly. sales ops between and coordination then, also And

ops As to see that relate the a can in quicker. market, the softening sales, they

I move can in flat system, nimble management a quickly, and as more believe operating change. can so we that So quickly they respond markets

are So up is some most through driven we make, per fee side. it's the driven is shift at around at on but going efficiency supply in some savings changes be to driving may have and and where sales maintenance with it the themselves, we'll to most line mines going the you of bringing be the the more through mine indirect efficiencies

Operator

Daniel question ahead. Our next Scott Clarksons. comes from from go Please

Daniel Scott

what My in discontinued Can a operations quarter. that loss want made echo quarters? Andy, quarter other is on the this sizable role. up question was versus pretty why I new comment, and through you so from walk the big there Mark's was of kind for Congratulations to David. it

David Stetson

booking quarter, was exist of actually is X, entirely the This for the kind condition related sheet though even the it's Blackjewel balance filing almost ARO, at July of date. difference. the that It's to the outside bankruptcy on one day’s to didn't hard argue

did ahead went we record. and So

course and all back you’re I sheet, that's the has. and number more consists zip to to GAAP on Wyoming with up back books with that you things includes portion the mentioned the contract shovel a estimate the of number, million start The which earlier, you're binding it to cost like the starting discounted rate has that that that and at and that, that, big XXX-ish so does initial the market extra arrow ups that discount the code of and number that capital, of our of and it $XXX coming discounting the gets balance of on but shows larger on

Daniel Scott

just taking desire perception coming stepping the there? I here. given become this then message least title earlier? and Blackjewel risk from Blackjewel limited it was the a of is those When a taking or recognition maybe was that, and back exposure assets Is the Or the the at pretty care perception assets. been is there? that a of get that change back, in-house, maybe of overhang to and your filed, thinking development was And stalking-horse an What's bring has that the think, Contura a operating to to the bit that

David Stetson

the legal the the had it permits irrespective the but end both was. tag were to of a irrespective of Basically, going from as responsibility of that, conclusion be kind held along the permit transfer was all we to the statutory little still think a -- I the fact perspective Dan, the of more it's coming we of a and that that bit Yes, lines it reclamation the process, with at status of permits. of

became to our the broad the we outcome drive the from And apparent get so and we best course that once best regulatory just as and in be outside of kind perspective, that mix we because which put counsel that would that looks at can I much could like, is of than and a the reclamation anything kind pretty better think bracket accomplish that. we've downside what to limited your a that determined now around point,

the that nourish organization. benefit a would Just

it what the a the So bit was there. a regulatory it. pretty and little little bit, it the was on was conclusion in a change on exposure Not significant understanding of

Daniel Scott

capital last did soon. million and of all? I or at that, the the lastly, table And mean then return most a XXX really the stock, coming wasn't authorization direction release, you this that's the was special And announced quarter believe your that about comments price likely of mentioned made talk you about in it but first up dividend is on tranche the

Andy Eidson

jump a good with This million I'll lead on where and the did amount in this we've naturally we too. mentioned, done is the have $XXX previously authorization. one a as of board work thing up you

that do up and reconstituted helping David little step far rows with And a move as conclusion analysis to I as of stuff. them getting forward. bit quick coming kind think of now liquidity what we're short to is We've understand work to as to got coming then board, to just in a the the in kind next the of speed.

our estimation share next the rather are through be they now anything entirely right things that or up talking a to a future. XXbX, dividends. tender I about open undervalued we this will sense the market price are current so But the Those repurchase, just Board, makes through think short-term again, again, work over so plan. and David than very at that XXb-XX personal whether Dutch from it's my as but

Operator

Pipes Riley ahead. Lucas FBR. Our B. go Please from next question comes from

Dan Day

Lucas. Day This on Dan is for

like I just run sort try the or the like like Plan would So to you like just mines. verse to maybe is maybe all, of, so them some -- reclaiming you to you And probabilities you go to reclaim, capacity A, reduced be think do assets you'd if run guess of decide could them put Thanks. some burn, that. if you just, it them of cash do I think capacity Blackjewel kind it the you route. and color like around first to So then run sounds do around with math, around deciding profitable? what that get turn you reduce Do just if

Andy Eidson

Sure, sure. A. Well, I wouldn't call reclamation Plan

who I something that transaction would shows to a and be being real probably else would a quickly Plan several Again, A the Plan there has up in operator outcome. A interest best be case this, looks that the bit think are terms with an think little in I do different. PRB a options someone there, be would

a option, time, those, as could But when between term the simply to some situations increases the continued board, we toward do I Eastern with being desire really is David ourselves particularly where there but out lengthy an you again look strategically, to met period not operator there are think in for have focus we view on even a for coming of that an more. properties, drive our

would some end think best And reclamation sense, get would point wants operator. PRB in be, again to see a who I where that case so else's to operating up to hands could a shorter-term someone you horizons assets be probably make think I but the

or And which, kind to it's it's immediate plan, a of would call worst cases, but to pretty not worst a tried wonderful stretch well want least case, what if I imagination. of it reclamation the define be, to have which as impact think at now cataclysmic not the by you outcome, it's reclamation, any again, we've

you a different two ones it's on adventure far over as depends again tough. of is you answer, It the turning I'll because time the day, been what And twisting months. give quite and one really that a as probabilities, me. past asked that

a that scenario, over plays Again, something reclamation next that the bit. could pending we'll have other out federal how things involved, bit to parties how looks we have resolved little with than just and the but the government see better a

Dan Day

be Have you you someone of an who to? anyone looking assets? wants might you're had think is be just Or to operator conversations something this with these

Andy Eidson

can't own I really. the mean, don't assets. I look, we

It that approved. sale process the out certain was of upon kind even closing is to that. bankruptcy though continues having The asset agreements contingent was deal we're raised. the being So of stay of

ongoing but I'm looked as that cloud peak I and at that they looking be people there on still to perspective. speak assets, are situation the sure particularly interesting don't can the So, just from there talking at to process, want relate some because Blackjewels are about things

For to someone operator. a PRB want who does be

Dan Day

one I'll in. sneak Just more.

has now space been there heard then M&A as we've So, far the last as of a conversations years. maybe there on over more few has in kind coal of the goes been going lot

any acquisitions, look like be where to you'd that basically as be limited areas you I'm of in met you would of be would kind color well? you're of to outside grow? like look Appalachia? do Or Or there already for would growth far some maybe just As CAPP guys consider, sort looking as

David Stetson

it this this is would answer way. David. I Well,

enhance enhance capabilities further look at to to us probably some further We do Central will to going be. footprint, expand primary And I App our offerings. believe there expand region. primarily anything I is certainly and the that's believe available We think to be will offerings, would that opportunities that, in that's our that strategic. be multiple bolt-ons will focus our our my

optionality. love I

no often competencies and ever in I watched something, ventured outside successful. of but sell say be have don't too their their have them, core areas that I people found core to if where and So I to

have. this work App Central me what region. the on Scott for directly option got Kreutzer be again, at with will lead to focus every we look that's primary I our taken well But So, me,

Operator

And we’ll call Stetson turn the back today. for to Mr. remarks over closing

David Stetson

thanks I the your a you thank Thank so of near to and day you, Again, future. interest for Have meeting your and Carol. rest much again. many Contura, forward with in of great everyone you look in

Operator

today's concludes conference This call.

now may disconnect. You

Alpha Metallurgical Resources (AMR) 14 Aug 192019 Q2 Earnings call transcript